Pressure Mounts on White House to Detail Effects Of Deep Defense Cuts

With clock ticking to get a deal, lawmakers and industry officials want White House impact estimate.

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Pressure is building on the White House to issue official figures on what would happen to the economy if $1.2 trillion in across-the-board federal spending cuts kick in next year.

Many lawmakers facing re-election along with defense industry officials are getting increasingly anxious about a second round of deep cuts to planned national defense spending.

Time is running out to avoid $500 billion in separate budget reductions to defense and domestic entitlement budgets that would kick in Jan. 1, unless Congress passes a broad debt-reduction package that would reduce the federal debt by $1.2 trillion.

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Pro-defense groups have said the deep Pentagon cuts, which would be scattered over 10 years, would cause 1 million jobs to be lost next year. But lawmakers and industry officials agree the White House's powerful budget office needs to release its own estimates of the economic impact caused by these cuts.

California Republican Rep. and House Armed Services Committee Chairman Buck McKeon told reporters last week that when Lockheed Martin CEO Robert Stevens asked the White House for that data, he was stonewalled.

"They told him, 'Don't worry about it. It's not going to happen'," McKeon says. To the powerful House lawmaker, "to say that is kind of voodoo magic."

Steve Bell, senior director of economic policy at the Bipartisan Policy Center, said during a forum Tuesday that the cuts will send ripple waves across local economies.

"People are going to start worrying about the grocery store [staff] that's going to go down to five," Bell said.

Bell also warned small businesses that do work for large defense firms are already feeling the effects of uncertainty about big defense cuts, using a hypothetical machine shop as an example, saying how an owner who heads to the bank where he has held a line of credit for 20 years will only encounter issue after issue.

"The bank says—and its got the FDIC looking over it's shoulder—do you have the contract yet," Bell says. "The [machine shop] owner says, 'We've had the contract for 20 years.' But the bank says, 'Well, let's wait until you get it.'"

Washington insiders and congressional sources say several groups of lawmakers have started to meet behind closed doors in an attempt to cobble together plans to avoid both defense and domestic cuts. And the hawkish GOP members clearly hear that clock ticking.

John T. Bennett covers national security and foreign policy for U.S. News & World Report. You can contact him at jbennett@usnews.com or follow him on Twitter.

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